FAQ
Frequently asked questions from classes will be posted here.
Q: “What should a CPA do when he or she encounters substandard work?”
A: The AICPA offers the following advice:
Help Protect the Public Interest
Members who notice, suspect or are aware of significant deficiencies in the work of another member should seriously consider referring the matter to the Professional Ethics Division. Prior to referral, consider your responsibilities under Rule 301 of the Code of Professional Conduct if the member is affiliated with a client (e.g., CFO of an audit client). If you are unsure of the applicability of Rule 301, call the Ethics Hotline at 888.777.7077 prompt 5 followed by prompt 2 for guidance.
If you feel strongly that the matter in question is serious, you can also refer it to the State Board of Accountancy. This can be done personally or anonymously.
In addition, you should consider contacting the CPA in question. At times, this approach is preferred because the CPA in question may not be aware of the existence of a problem and they may prefer to rectify the problem without the intervention of a third party.
Q: Class participants often ask questions regarding peer review. The two most common questions are:
- Who is subject to peer review?
- I only prepare compilations without footnotes. Am I subject to peer review?
A: The Arizona State Board of Accountancy recently posted the following information regarding peer review which addresses one of the most frequently asked questions. Peer review is covered in R4-1-454 of the administrative rules.
Firms Only Providing Non-disclosure Compilation Services (October 2010)
The Peer Review Oversight Advisory Committee (PROAC) has published the following Matters for Further Consideration (MFC) list in an attempt to assist firms subject to an Educational Enhancement Review (EER) . The MFC list addresses the most common findings discovered by PROAC during the EER and is broken down into four categories: Reporting, Presentation, Scope and SSARS No. 8.
Matters for Further Consideration (MFC) list = http://www.azaccountancy.gov/documents/MFC.pdf
Have a question about peer review?
The Firms tab, Peer Review page on the ASBA website has more on firms providing non-disclosure compilation services plus general information regarding Peer Review. See Peer Review FAQ at . http://www.azaccountancy.gov/Firms/PeerReview.aspx
Q: I have a question about Mobility. Where can I find resources?
A: The ASCPA http://www.ascpa.com/content/home.aspx has a resource http://www.ascpa.com/Content/39724.aspx for Arizona CPAs on their website:
Use this link to find out the latest information about Mobility www.nasbatools.com/mobility
Or go to the AICPA’s page http://www.aicpa.org/Advocacy/State/Pages/CPAMobilityResources.aspx
“Mobility” establishes the limited reciprocity privilege for out-of-state CPAs and improves the ease of movement for all CPAs, while providing the Accountancy Board with the ability to discipline non-Arizona CPAs.
The idea behind Mobility was born from the growing need, due in no small part to electronic communications, for licensed CPAs to gain a practice privilege outside of their home state without getting an additional license in another state where they will be temporarily serving a client.
Arizona is considered a “Gold State” where CPAs licensed here can practice limited movement with other states who have also passed Mobility legislation.
For more information about Mobility use the link: http://www.nasbatools.com/mobility or to see what other states have passed or are in the process of passing Mobility, you can also visit www.aicpa.org or you may contact Adela Jiménez, CPA, at the ASCPA by email at ajimenez@ascpa.com or by phone at (602) 324-2972.
Q: Have questions regarding Interpretation 101-3, Nonattest Services?
A: The AICPA has provided an updated FAQ for Nonattest services:
Note: The Ethics Division Website has been redesigned! Information regarding the activities of the Professional Ethics Executive Committee can be found under Community and numerous tools and aids issued by the division or others can be found under Resources. Journal of Accountancy articles such as Test Your Knowledge of Professional Ethics, past versions of Ethically Speaking, recently issued papers by the division and disciplinary reports can be found under News and Publications.
